Foreigners looking to invest in Mexico’s coastal properties, including Puerto Vallarta and Riviera Nayarit, must navigate the fideicomiso (bank trust) system. This legal structure allows non-Mexican buyers to securely own property in Mexico’s Restricted Zone while complying with national regulations.
This guide explains what a fideicomiso is, how it works, and why it provides a secure option for foreign buyers.
1. What Is a Fideicomiso?
A fideicomiso is a bank trust that grants foreigners full ownership rights over property in Mexico’s Restricted Zone, which includes land within:
(✔) 50 km (31 miles) from the coastline
(✔) 100 km (62 miles) from international borders
Foreign buyers cannot hold direct title to land in these areas but can acquire property legally through a fideicomiso, established with a Mexican bank as the trustee.
(Important Note) Related Guide: Buying Property as a Foreigner in Mexico’s Coastal Areas
2. How Does a Fideicomiso Work?
The fideicomiso allows a foreign buyer (the beneficiary) to hold ownership rights while a Mexican bank (the trustee) holds the legal title on their behalf. However, the buyer retains full control over the property and can:
(✔) Sell or transfer the property to another buyer.
(✔) Rent or lease the property for personal or investment purposes.
(✔) Inherit the property by naming beneficiaries.
(✔) Make modifications or improvements as desired.
The fideicomiso is granted for 50 years and is renewable indefinitely, ensuring long-term security for foreign investors.
(Important Note) Related Guide: How to Verify a Property’s Legal Status Before Purchase
3. How to Set Up a Fideicomiso
Setting up a fideicomiso involves a legal process managed by a Mexican bank and overseen by a notary public. The key steps include:
(✔) Signing a Purchase Agreement – The buyer and seller agree on the terms of the sale.
(✔) Bank Trust Authorization – The buyer applies for a fideicomiso with a Mexican bank, which acts as the trustee.
(✔) Government Approval – The Mexican Foreign Affairs Ministry grants permission for the trust.
(✔) Closing & Registration – A notary public oversees the transaction, finalizing the property’s registration.
(Important Note) Related Guide: Understanding the Notarial & Legal Process in Mexico’s Beach Zones
4. Costs & Fees Associated with a Fideicomiso
Foreign buyers should be aware of the costs associated with setting up and maintaining a fideicomiso, which include:
(✔) Setup Fee – $1,000–$1,500 USD (one-time cost).
(✔) Annual Fee – Approximately $500 USD per year.
(✔) Notary & Legal Fees – Typically 1%–2% of the property’s value.
(Important Note) Related Guide: The Hidden Costs of Buying Real Estate in Puerto Vallarta
5. Benefits of a Fideicomiso for Foreign Buyers
A fideicomiso provides numerous advantages for foreign buyers investing in Mexico, including:
(✔) Full Ownership Rights – The buyer retains the right to sell, lease, or modify the property.
(✔) Inheritance Protection – The buyer can designate beneficiaries to inherit the property without additional legal processes.
(✔) Legal Security – The fideicomiso ensures compliance with Mexican property laws, reducing the risk of disputes.
(✔) Renewable Structure – The trust is valid for 50 years and can be renewed indefinitely.
(Important Note) Related Guide: How to Conduct a Legal Property Verification in Mexico
6. Frequently Asked Questions About Fideicomiso
Q: Can I buy property in Mexico without a fideicomiso?
A: Only Mexican citizens and legal entities can own land in the Restricted Zone without a fideicomiso. Foreign buyers must use a bank trust or purchase through a Mexican corporation.
Q: Is the fideicomiso process complex?
A: While the process involves multiple steps, an experienced real estate agent and legal team can handle the fideicomiso setup smoothly.
Q: Can I transfer my fideicomiso to another buyer?
A: Yes, fideicomisos are fully transferable, allowing buyers to sell the property without complications.
Q: What happens if I don’t renew my fideicomiso?
A: If a fideicomiso expires and is not renewed, the property reverts to the Mexican government. However, renewal is a straightforward process.
(Important Note) Related Guide: Step-by-Step Guide to Closing a Real Estate Transaction in Mexico
Final Thoughts: Securing Your Investment with a Fideicomiso
A fideicomiso offers a secure and legal way for foreigners to invest in Mexico’s coastal real estate market. By working with NuHome Realty Co.®, buyers can navigate the fideicomiso process smoothly and confidently, ensuring a safe and profitable property purchase.
(Contact NuHome Realty Co.) Ready to invest in Puerto Vallarta real estate? Contact NuHome Realty Co.® today to explore the best coastal properties in Mexico!
Posted by Cathy Rios on February 18th, 2025
Posted by Cathy Rios on
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